Business sentiment index turns upbeat according to survey

TAIPEI, Taiwan -- Taiwan's concerns over economic slowdown abated in the second quarter as companies became optimistic, according to the Central News Agency (CNA).

CNA cited the ThomsonReuters/INSEAD Asia Business Sentiment Survey to report that the business sentiment index in Taiwan rose to a score of 67 from the previous quarter's 50. A reading above 50 indicates an overall positive outlook.

"Optimism returned to Taiwan's sentiment index, reversing the decline in the March quarter," the report said. "Two of the six respondents turned positive in their outlook compared with none in the last survey."

The ThomsonReuters/INSEAD Asia Business Sentiment Index rose significantly to 74 in the second quarter compared to a 64 reading in the first quarter, with an upswing in sentiment across most of the region.

Of the 124 companies polled, none reported a negative outlook for the first time in the survey's history, Reuters said. Sentiment is scored on a 0-100 scale, with figures above 50 indicating a positive outlook.

A similar pattern emerged in mainland China, Taiwan's largest trading partner, with the index also rising from 50 to 67 since the first quarter. Half of respondents witnessed rising new orders and sales in the second quarter, with global economic uncertainty cited as the top risk.

Sentiment fell in Japan and South Korea, down from 59 to 56 and 67 to 50, respectively, from first to second quarter.

Within South Asia, firms in India gave ringing endorsement of the pro-business policies of newly elected leader Narendra Modi.

Thailand also showed a strong recovery, with the index increasing from 41 to 91 since the first quarter.

The respondents had lingering concerns, however, about the global economy, rising costs and exchange rate volatility. The report noted that two of six respondents lowered employment levels this quarter compared with steady levels in last quarter though two companies reported an increase in orders as compared to just one in the previous quarter.

The poll conducted by ThomsonReuters and INSEAD, a global management and business school, was carried out June 2-13.